For many years, Electricity in mining was treated entirely as a cost to be managed and was not considered a strategic lever. But this thinking has largely changed as mining companies invest in large-scale renewable energy projects.
Eskom's aggressive tariff increases, grid constraints and increasing global decarbonization pressures now mean that renewable energy is being incorporated into the planning and operation of mines.
Energy security has become a top priority for South Africa's mining industry. The main discussions at this year's Mining Indaba focused on how to ensure reliable and uninterrupted access to energy, grid expansion and flexible power systems.
according to Christian TefoDeputy Head of Technical Economics Mineral Council South AfricaMining companies are shifting from small pilot projects to large-scale solar and wind facilities over 100 MW. They are also signing long-term power purchase agreements (PPAs) with independent producers and delivering power from the grid to multiple sites.
He said that based on estimates, out of the estimated 7GW of distributed renewable energy in the country, about 1.5GW are installed mining renewable energy projects. With nearly 18GW of renewable energy projects registered by energy regulator Nersa, many more projects are in the pipeline.
“Mining companies are taking new steps to manage their energy needs. Many are creating specialized teams inside the company to focus on energy and even setting up energy trading desks,” Tefo told TechCentral.
digital devices
“Some mines are now planning their production schedules so they use energy when it is most available, especially from sources like solar or wind. They are also using digital tools to keep track of how much energy they use and control their energy loads more efficiently.”
Renewable energy is now part of long-term mining planning, he said, adding that energy management has become important and is now central to mining strategy.
Tefo said significant progress has been made in the last five years, largely due to government reforms Operation Vulindela and energy policy changes remain major challenges. These include limits on grid capacity in critical mining areas and longer timelines to secure grid connections.
Reading: How liberalization is reshaping South Africa's power sector
Other concerns are that tariff rules are sometimes confusing and that municipalities may make wheeling difficult due to their lack of experience. Upgrading transmission lines is also “very expensive”.
But by adopting renewable energy, mines are able to secure low and stable electricity rates, reduce vulnerability to sudden tariff increases, protect marginal sites and smelters, and increase their position in international cost rankings.
“This is particularly important for energy-intensive industries such as gold, chrome and platinum. High electricity prices could force many operations to close if there is a lack of access to renewable energy. Therefore, renewable energies are about much more than ESG (environmental, social and governance); they are essential for survival and long-term viability.”
Teffo said many renewable energy projects exhibit payback periods ranging from five to eight years. However, this may vary depending on electricity tariffs and project financing structures. Some mines take advantage of third-party financing arrangements such as PPAs to reduce capital requirements and accelerate the transition to green energy.
Renewable energy platform and integrated power integrator Lyra Energy will soon deliver power directly to industrial off-takers, including mines, across the country after being awarded a Nersa trading license last year.
Liesel CassierA senior business developer at Lyra Energy told TechCentral that renewable energy is transforming mines from passive power buyers to active energy managers.
Behind-the-meter solar power and storage – combined with wheeled renewable energy – allows mines to reduce the risk of tariff increases, improve cost predictability and cut Scope 2 emissions, which are indirect greenhouse gas emissions from the production of purchased energy that a company consumes.
Operational changes help smooth out peak demand, support uptime and reduce reliance on emergency measures.
He said that as South Africa moves towards a more tradable market through the development of the South African wholesale energy market (Savem), which will be launched in April, miners who can actively manage load and contract intelligently are in the best position to capture value and minimize risk.
Control
liberalization of energy markets The options for mining houses have been radically expanded, from “one supply model” to multiple procurement and exposure pathways, he said.
“The biggest change is control: mines can tailor tenor, volume size, risk allocation and reliability mechanisms to their actual load profile, rather than accepting a standardized product. As SAVEM evolves, it becomes even more powerful – as markets create more price signals and more tradable products, and mines can use contracts and portfolio design to actively manage costs, carbon and operational risks,” Cassier said.
Reading: South Africa is pumping billions of dollars into renewable energy in a race to fix its grid
Buying power (a service) rather than plants (assets) generally reduces risk and preserves capital, he said. This helps mines avoid construction, performance and technology obsolescence risks. It also reserves capital expenditure for core mining requirements and transfers availability and output risks to specialist developers or operators – while still locking in long-term value and renewable characteristics.
Another benefit of going green is that fixed-term PPAs lock in a known price or price path for a certain period of time, thereby stabilizing energy costs rather than dealing with volatile utility or municipal charges.
One of the most recent mines to sign a PPA to purchase wheeled renewable energy is Sibanye-Stillwater, with Aetna Energy.
Under the 10-year agreement signed earlier this month, Aetna Energy will supply 600GWh of renewable electricity per year from solar and wind projects, equivalent to about 220MW.
Wheel power will be delivered to the mine using the national electricity transmission network.
When commissioned late next year, the renewable electricity is expected to reduce greenhouse gas emissions by about 648 000 tCO₂e per year, Etana said in a statement.
With energy emerging as a central theme at the Mining Indaba, Tefo said the mining industry has agreed on actionable and practical solutions rather than a theoretical approach.
There is clear consensus that there is an urgent need to expand and modernize the grid to support new and existing energy demands. And as renewable penetration increases, the next major area of growth will be storage solutions and flexible power systems to maintain sustainability and efficiency.
The Minerals Council's priorities are to ensure fair and equitable access to the electricity grid for all participants; Advocating for cost-reflective electricity rates to promote efficiency and sustainability; supporting the development of a competitive electricity market; and providing targeted support to energy-intensive sectors within the industry.
Reading: Large solar and energy storage projects are coming up across South Africa
“There was remarkable alignment between industry stakeholders and government on the need for ongoing reforms. The overarching message emphasized that, while South Africa has made solid progress, the pace of implementation and the capacity to deliver reforms now represent the greatest challenges,” Tefo said. – © 2026 NewsCentral Media
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